Secrets to 0% Balance Transfer Credit Cards

If you are seeking to get out from under your credit card debt, one option to consider is to use a 0% balance transfer credit card. The major benefit of these cards is that you can have a break from paying high interest fees. During this time, you can attempt to turn your attention towards paying off your credit card debt.

The Wizard © Sean McGrath

Of course, it should come as no surprise that the credit card companies don’t offer these 0% balance transfer cards out of the goodness of their hearts. Instead, they are seeking not only to get new customers, but also to ensure that these new cardholders place an ample amount of debt on their new credit cards. After all, at a certain point, the 0% interest rate incentive will run out. For example, some credit cards pay will offer no interest on balance transfers for 12 months and some may offer this incentive for as long as 18 months.

Obviously, if you are planning to transfer your balance onto a 0% balance transfer credit card, you should select one that lets you have as long of a pay-off period as possible. This will give you extra time to gather the money together to pay off your credit card balance.

However, it is also important for customers to carefully look at what interest rate the credit card company plans to charge once the incentive period of zero interest has expired. Occasionally, credit card companies will charge exorbitantly high interest rates once this initial period has ended. This rate might even be higher than that you originally had on your prior credit cards. Keep in mind that any balance that you have not paid off will automatically begin to incur interest at this rate.

Also before signing on the dotted line, check out if the credit card has an annual fee. Sometimes people accidentally overlook these fees when they sign up for a new credit card. Unfortunately, annual fees are just another annoying cost that you will likely regret in the future.

Be sure that you select a credit card that has an interest rate with which you are comfortable. After all, even if you are currently convinced that you can pay off your balance in the time period that you have chosen, you never know what kinds of curve balls life can throw you. If your balance is not paid off at the end of the allotted zero interest rate period, you don’t want to be left with an extremely high APR to contend with.

Yet another consideration to keep in mind is whether or not the 0% balance transfer credit card charges you a fee to make your initial balance transfer. This fee is often 3% of your balance, but it can be more.

Take some time to access whether these fees makes sense. After all, if you owe a huge amount of money on your credit cards, they could amount to a rather sizeable sum of money.

Once you have transferred your money to the zero interest credit card, try to start paying it down right away. If you can quickly pay off the card during the period where you save regular interest fees, you may indeed save a great deal of money in the process. If you proceed wisely, taking to the time to sign up for a zero interest credit card can be well worth the effort.

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